Licensing and Franchising (Global Marketing)

Licensing is a business agreement in which the owner (the licensor) grants permission

Global Marketing - Distribution

Licensing is a business agreement in which the owner of Intellectual Property (the licensor) grants permission to another party (the licensee) to use, produce, or sell products or services using the licensor’s Brand, patent, trademark, technology, or other proprietary assets. In exchange, the licensee typically pays a licensing fee or ongoing royalties.

General Electric (GE), a U.S.-based multinational conglomerate, has extensively used licensing as a strategic tool to expand its technological products into international markets—particularly in regions where Direct Investment or full ownership posed significant Risks or high costs.

Franchising is a comprehensive business model in which a franchisor grants a franchisee the right to operate a business under the franchisor’s established brand name, trademarks, and proven business methods. In return, the franchisee agrees to follow strict operational guidelines and standards while receiving ongoing support, training, and Marketing assistance from the franchisor. Although the franchisee owns and manages their business, they do so within the framework defined by the franchisor.

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